Spot bitcoin ETFs were approved by the SEC on January 10, 2024 — almost one year ago. As we approach this anniversary, it is impressive to see all the ETF milestones resulting from the launch.
In the broader crypto industry, however, exchange-traded funds have somewhat faded into the background, as other tailwinds (e.g., a potential strategic bitcoin reserve, increased interest in tokenization, and a greater intersection between energy and crypto) take center stage. But for advisors, retail investors, and many institutional investors, ETFs are our bridge from TradFi to DeFi and will remain a relevant part of the digital asset story in 2025. If innovation in crypto is expected to continue, then the ecosystem of crypto ETFs will also continue to grow. Here is where crypto ETFs stood in the past year and what to watch for in 2025.
2024: Bitcoin’s Big Impact in ETFs
To put the impact of crypto ETFs in perspective, here are some interesting figures from this past year:
- In 2024, there were 43 crypto ETF launches (including conversions). With around 75 U.S. crypto ETFs, that means over half the universe was launched this year.
- Of the 43 crypto ETF launches, around half were spot ETF launches—12 spot bitcoin ETFs and nine spot ether ETFs.
- 12 of the new launches were leveraged ETFs, and five were option income ETFs. The remaining five were a mix of hedged equity, crypto equity, and multi-asset ETFs.
- Not included in this total count — but still relevant — are five single-stock Microstrategy (MSTR) ETFs launched in 2024. Microstrategy has been used as a proxy for bitcoin, and notably was added to the Nasdaq-100 index during its end of year reconstitution.
- ETFs brought in over $1 trillion in net inflows in 2024. Out of almost 4,000 ETFs, the iShares Bitcoin Trust (IBIT) had the third highest inflows ($37 billion) after broad large-cap U.S. ETFs, the Vanguard S&P 500 ETF (VOO) and the iShares Core S&P 500 ETF (IVV).
- IBIT has $56 billion in assets — more than the iShares Gold Trust (IAU), which has only $33 billion in assets. IBIT is now the 32nd largest U.S. ETF.
- The Fidelity Wise Origin Bitcoin Fund (FBTC) is now Fidelity’s largest ETF by assets, with over $21 billion AUM. The next largest Fidelity ETF is the Fidelity Total Bond ETF (FBND), with $17 billion.
- Excluding leveraged and single-stock ETFs, the Grayscale Bitcoin Trust ETF (GBTC) was the best-performing ETF (up 145% YTD).
2025: Crypto ETF Innovation Ahead
Looking ahead to 2025, several ETF filings are already in various stages of approval. With the new crypto-friendly U.S. administration (including a change in SEC leadership), issuers are filling the pipeline with potential new products. There will likely be three main areas to watch.
First, there is the possibility of more spot ETFs beyond bitcoin and ether. VanEck, 21Shares, Canary Capital have filed for crypto ETFs, including spot solana and XRP ETFs. Canary Capital has also filed for a litecoin ETF and an HBAR ETF.
Additionally, there will be further innovation in the way digital assets are packaged in ETF wrappers. These include filings for several crypto index ETFs (multi-token funds). One proposed fund is the Bitwise Bitcoin and Ethereum Fund, which would give balanced exposure to both currencies. There have also been requests to convert the Grayscale Digital Large Cap Fund (GLDC) and the Bitwise 10 Crypto Index Fund (BITW) into ETFs. These are multi-token funds, which hold bitcoin, ether, solana, and more.
Finally, there’s the “everything else” category, which includes various strategies with crypto flavor. For example, the Nexo 7RCC Spot Bitcoin and Carbon Credit Futures ETF is an ESG Bitcoin ETF which will hold about 80% Bitcoin and 20% carbon credit futures. The Bitwise Bitcoin Standard Corporations ETF intends to invest in corporations that hold at least 1,000 bitcoin in their corporate treasuries. And the Strive Bitcoin Bond ETF aims to provide exposure to convertible securities issued by MicroStrategy.
Additionally, I believe we will see even more options-based strategies. In late January, Calamos is planning on launching the Calamos Bitcoin Structured Alt Protection ETF (CBOJ) which is a 100% downside protected bitcoin ETF (a recently popular buffered strategy).
And as we saw toward the back half of 2024, crypto equities have come back into favor, due to rekindled interest in MicroStrategy and crypto miners which have pivoted to benefit from data center demand. More launches in this category are likely, as many brokerage firms still have trading restrictions for spot bitcoin ETF products.
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